Can the leading smartphone manufacturers ride the success of VR to maintain profit levels?
Name a device that’s made a massive impact of the way we communicate over the last ten years and it’s odds on that the smartphone will be first on your lips. They’re everywhere, and to leave home (or even be in it) without your phone is almost inconceivable. Every time we walk out the door, the phone is just as essential to search for as the door key, car keys, wallet, or handbag.
So it’s no surprise that the market is huge, with billions sold.
But what happens when that market reaches saturation point? Sure, there are always new and upgraded models seeing release which many of us will want (and buy). We drop them and need replacements, there are youngsters hitting the age where they’ll need one, there may even be a handful of us who’ve never had one but finally succumb. Can all this keep the profits for the manufacturers?
The answer may be no. There are signs in the marketplace that purchases are slowing down. Yes the smartphone is a device that’s as critical as your next dinner, but you won’t be buying one every day. Those big manufacturers need new ways of encouraging sales, and the explosion of interest in virtual reality can be one of those ways.
What Part Does The Smartphone Play in VR?
We’ve seen that the so-called cardboard VR headsets offer a low cost entry point to VR entertainment. They give access to some admittedly less immersive gaming than the more expensive desktop PC headsets, but still offer a great starting point for watching content like 360 virtual videos, and they generally offer the lowest priced entry point for any of us keen to see what VR has to offer.
Samsung are one of the big smartphone maker names in the field. During the Mobile World Congress trade fair in Barcelona of 2016 they announced they’d be shipping free Gear VR headsets alongside new Galaxy S7 phone orders, sadly only for US or Puerto Rico residents though. See the video below for more on the S7.
LG announced their headset model in early 2016. Chinese firm TCL also have plans for a VR ready release. It’s only a matter of time before other big names try to make their mark, with Apple possibly being the one to watch most closely.
So Will VR Drive Additional Smartphone Sales?
With the ultra high cost of the alternatives, smartphone powered VR headsets look set for continuing success, perhaps at a level that can only be halted by heavy price reductions in competitors or the release of the Sony’s Playstation headset at an affordable price.
VR is a huge potential market. Some predictions for device sales put the numbers as around 20 million by 2018. There’s plenty of opportunity for smartphone powered models to make up a sizeable percentage of this figure.
Some technical problems have to be solved. No doubt they will be. Battery life can be a problem, as can the issues with overheating. And virtual reality does still need to prove that it is more than a passing fad.
All in all, if VR is the success everyone seems to think it’ll be, it does seem sure that the technology will drive a significant number of purchases that wouldn’t have materialised without it. Whether this will be enough to keep the profits of manufacturers at the ‘right’ levels is debatable, but we surely are nowhere near seeing the end of the smartphone phenomenon.